Apparel retailers are now holding huge sales online as coronavirus-related store closures continue.
At Gap, you'll find up to 75% off everything, as well as an extra 50% off markdowns with the code "PERK." The brand is also prominently featuring its collection of sweatpants and sweatshirts with the tagline "Home Sweats Home," in an apparent bid to win over the millions of people sheltering in place during the coronavirus outbreak. source Business Insider
Retail brands of all flavours are now passing key elements of the fiscal pain of this crisis further down the supply chain by offloading committed orders, or worse still refusing to make payments.
As a business transformation consultant this change in relationship management between buyer and supplier will no doubt have wider ramifications to accelerate a trend that started prior to Covid-19, and will no doubt gather greater pace as traditional retail continues its further decline.
There's been a huge shift in B2B sectors that's seeing brands that were once a supplier to the wholesale and retail sector choosing to go direct to the consumer (D2C), and where 90% of those consumers say they are more than happy to deal with them - so, is today's supplier possibly tomorrows competitor?
Prior to this crisis we read that 'Nike' is to end its supply agreements with dozens of independent retailers as it accelerates efforts to sell more of its products direct to consumer.
The sportswear giant has told smaller retailers that access to its products will end in two years (2021) – placing the likes of Sports Direct and JD Sports on red alert that it could also scale back its agreements with larger retail customers.
If you operate in other sectors of the retail landscape, especially those in the supply chain side of B2B who rely on retail as a key partner, you might be thinking 'so what'?
I might be inclined to agree if we were talking about 'multi-million ££$$ hardware and software deals, however, there are many manufacturing companies like Philips, Unilever, Proctor & Gamble, who are highly dependent on a similar distribution model as those sports shoe companies.
If, as some suggest the growth in online sales for grocery retailers jumps to circa 20%+ what impact is that going to have on the huge legacy investments in Supermarket real estate? How do FMCG brands like 'Unilever, P&G, GSK, Philips, GE Healthcare' and others remain front of mind when trying to convince us that they're handwash, soap, health, wellness and beauty products are the best and the most 'innovative' when the consumer increasingly chooses to shop online for the 'convenience?
You only have to consider the multi-levels of distribution that all those car manufacturers and financial services products currently have to go through, which includes a myriad of dealers and brokers.
And their 'go to market' communications strategy just happens to be via the free to access, free to use social media platforms around the world.
It might not be happening with them yet, but you're not sat in those 'secret' meetings are you?
When asked over 90% of consumers would be happy to deal with the brand direct. If this is to be believed and I do have other case studies that suggest this is a logical behavioural trend should those retailers be getting ready to face the next wave of disruption from what used to be todays supplier is now becoming tomorrow's competitor?